Bringing together the best longer Interpreter articles you were too busy to ready this week.

A couple of big news items in Southeast Asia this week: the dismissal of Thai Prime Minister Yingluck Shinawatra and the maritime 'incident' between Chinese and Vietnamese vessels in the South China Sea. Elliot Brennan described the events in Thailand as a 'judicial coup':

Thailand has a long history of politicisation of its judiciary (an in-depth look at Thailand's judicial coup culture is here and here). Yingluck's dismissal is widely seen as having been orchestrated by her political opponents rather than through an independent process by the judiciary.

Thailand's judiciary, including the Constitutional Court, is seen to be strongly in favour of the Yellow Shirt group, largely made up of Bangkokians and the wealthy elite. But the Yellow Shirts, who have taken to the streets in protest during the past six months, are unlikely to be entirely satisfied by her removal. Many still believe that the Shinawatra's influence in politics is too great and an appointed reformist council should be installed before new elections take place. A mass rally is planned for Friday at Lumpini Park in Bangkok.

On the other side, Yingluck's Red Shirt supporters have long declared that they would descend on the capital if she was forced from office.

Lowy Institute Nonresident Fellow Milton Osborne reported from Bangkok a couple of days later:

The court's ruling, which also included the dismissal of nine other members of Yingluck's government, still leaves other cabinet members in place to form a continuing caretaker government in the lead-up to fresh elections due in July.

Reactions to Yingluck's dismissal have been predictable. Leader of the anti-Yingluck protest moevement Suthep Thaugsuban claims the court's decision represents the final blow against her Pheu Thai party, but then he has been making similar claims for some months. Whether he can translate his claims into actions beyond yet another protest march remains uncertain and there seemed to be little activity among his supporters in the camp they have established in Lumpini Park when I visited yesterday afternoon.

Pheu Thai representatives have, of course, condemned the decision and called for a Red Shirt demonstration tomorrow. Large numbers of Red Shirt suppporters are assembled on the edges of Bangkok.

On the South China Sea, I asked what China gets out of escalations such as those it undertook last weekend, and suggested another strategy for the Chinese leadership:

Let's assume for the moment that China's growing assertiveness on territorial disputes is a conscious decision from Beijing's central leadership. If the ultimate aim is to assert China's influence in the region (in other words, doing what comes naturally to all great powers), on what grounds has Beijing determined that assertiveness on territorial disputes is the most effective means to that end? In fact, wouldn't China be better off with the opposite strategy, one of doing nothing except continuing to grow as a world economic power? If Beijing kept its defence spending stable in relation to GDP and did little to provoke balancing coalitions, it would still over time develop a formidable military and enormous economic pulling power. Those same forces would ensure a relative decline in US power in the region over the same period. Wouldn't those factors alone give Beijing the regional influence it desires in the long term? And wouldn't that be a cheaper and less risky approach?

Dirk van der Kley provided some context to the China-Vietnam maritime incident, suggesting three factors largely absent from the immediate media coverage. Here's Dirk's third factor:

Finally, CNOOC has a history of conflating resource exploration in the South China Sea with sovereignty claims. Large state-owned enterprises like CNOOC are powerful players in Beijing, and CNOOC could be one of the drivers behind the decision to move the drilling rig into disputed waters. At the very least, it would actively support the rig being used as a tool in sovereignty disputes.  

CNOOC has a track record of involving itself in sovereignty issues in the South China Sea. In 2012, the company offered nine oil and gas blocks for bidding by foreign companies in an area almost completely within Vietnam's exclusive economic zone. CNOOC also provides optimistic hydrocarbon estimates in the South China Sea. One could assume this is an attempt to win policy and financial support from the central government for activities such as the building of deep water drilling rigs like Haiyang Shiyou 981.

This rig, launched in 2012, gives CNOOC the capability to drill to depths of 3000m, greatly expanding the areas in the South China Sea that CNOOC can drill without relying on foreign companies. Chairman Wang Yilin has been quoted saying that 'large deepwater drilling rigs are our mobile national territory and strategic weapon for promoting the development of the country's offshore oil industry.'

 And lastly on the South China Sea, Malcolm Cook looked at the implications for the upcoming ASEAN summit in Myanmar:

Vietnam and China are embroiled in a serious dispute over the towing of a Chinese oil rig (with naval and air cover provided) to a position the Vietnamese claim is on their continental shelf, and the Philippines and China are in dispute over Ayungin Shoal and the recent arrest of 11 Chinese sea turtle poachers by the Philippines in waters close to Palawan, which China claims. China’s oil rig actions and the blocking of supplies to Philippine troops on Ayungin Shoalclearly contravene the spirit and letter of the 2002 Declaration.

An ASEAN Summit brings together the leaders of the ASEAN member states. If they follow in the footsteps of their foreign ministers in 2012 and fail to come out with a Summit statement that addresses the tensions and Chinese actions in the disputed waters of the South China Sea, the cracks could be too wide and deep to paper over again.

Still in that part of the world, we had an excellent post this week from Richard Javad Heydarian, who analysed the implications of the the recent US-Philippine security agreement for the pivot, the South China Sea, and for Philippine politics: 

Filipino officials hailed the EDCA as a reflection of a deepening bilateral military alliance, enhancing the Philippines' capabilities to manage emerging security challenges. Philippine Foreign Secretary Albert Del Rosario, a key figure behind the deepening Philippine-US defence alliance, argued that the EDCA 'mark(ed) a milestone in (Philippine-US) shared history as enduring treaty allies,' paving the way for a 'new chapter for modern and mature partnership, firmly grounded on deeply held democratic values, common interests and shared aspirations.'

Critics, however, remain unconvinced, dismissing the new agreement as a strategic blunder which will deepen the Philippines' dependence on the US without necessarily deterring China's territorial assertiveness in the South China Sea. During his visit to Manila, Obama refused to clarify whether the US would come to the rescue of the Philippines if a conflict were to erupt over the disputed features in the South China Sea. He made it clear that the EDCA was not aimed at China, since Washington does not take a position on the sovereignty of disputed territories and is primarily concerned with freedom of navigation in international waters. He encouraged the Philippines' to pursue a rules-based diplomatic compromise with China, since 'it's inevitable that China is going to be a dominant power in region.' 

Jenny Hayward-Jones released a Lowy Institute publication this week on the lessons Australia can learn from the Regional Assistance Mission to the Solomon Island. In her accompanying Interpreter post, Jenny outlined her thesis:

I argue this was a massive and disproportionate investment to restore stability in a small country, which became and remains today the third largest recipient of Australian aid. RAMSI expenditure, 95% of which was covered by the Australian Government, also saw Solomon Islands move from being the 35th most aid-dependent country in the world before 2003 to being the second most aid-dependent country in the world by 2009.

Although RAMSI was undoubtedly costly, it had some impressive results.

The Mission restored law and order in Solomon Islands in fairly quick order. RAMSI assistance also helped reconstitute a shattered economy and was instrumental in rebuilding the machinery of government. These successes were largely due to Australia's decision to establish a unique whole of government approach to its leadership of the mission, involving DFAT, AusAID, Finance, Treasury, Defence and the Australian Federal Police in a united effort.

We've had a couple of interesting responses to Ric Smith's post last week which suggested that the '2% of GDP' formula may not be the best way to hold a government accountable on defence spending. Here's Andrew Carr and Peter Dean on why the the formula does not help, and in some cases hinders, strategic policy development:

Arguably, since the 1980s getting enough funding and efficiently using it has been the primary concern for those interested in Australian defence policy. With the changes in our region and questions over Australia's role in the future, this debate is not enough. The only thing the otherwise ahistorical 1938 comparison gets right is recognising that today is also a momentous period in Australian defence policy. To ensure our security we need a big debate over the ends of national policy — what we want to be able to do, where and how, and what that will cost — rather than simply whether we are doing enough to sustain current efforts.

The pledge to spend 2% of GDP emerged from pre-election rhetoric from both sides. Let's hope that now in office, the Abbott Government can put such claims aside and listen to the experts like Ric Smith on the need to seriously think through how Australia can achieve its security. Only once we have a real idea about whether the Government's strategy has any merit can we begin to focus on holding them to account for properly funding it.

Crispin Rovere countered that the '2% to GDP' formula is more about alliance management than anything else:

If Australia does not contribute financially to the alliance we will end up paying in other ways — through the increasing erosion of Australia's sovereignty. This includes expanding the American military presence on Australian soil, deepening our bilateral co-operation on ballistic missile defence, and an open financial commitment to failing American fighter projects.

Without adopting the minimum buy-in as a US ally (which is the NATO figure of 2% of GDP), either the alliance will erode (forcing a dramatic boost to Australia's defence spend anyway), or Australia will face reduced decision-making independence in the Asia Pacific and declining influence in Washington.

I whole-heartedly agree that Australia's defence planning must be based on sound methodology that seeks to maximise the strategic return on every dollar spent, but to suggest that the 2% of GDP defence target should be abandoned on that basis is to make a complete non sequitur.

In Australia, the biggest news this week (besides the Packer-Gyngell Bondi boxing match) has been the recommendations from the National Commission of Audit. Naturally, much of the reporting has focused on domestic issues, but the Lowy Institute's Alex Oliver looked at what the Commission's recommendations might mean for Australia's international portfolio:

The incoming Coalition Government made promising noises about defence funding and Australia's global diplomatic representation both in its pre-election policy statements and in its first months in government. It also telegraphed a scaling-back of the rate of increase in Australia's official aid funding,pegging it to the consumer price index (CPI) rather than the ambitious target set by the former Labor government of reaching 0.5% of GNI by 2017-18.

On aid, there are no surprises (and nothing original) from the Audit Commission. CPI it is. Then again, after the massive disruption to the aid function (and foreign affairs infrastructure) caused by AusAID's 'integration'  into DFAT ('enabling the aid and diplomatic arms of Australia's international policy agenda to be more closely aligned'), the Australian aid program must be becoming habituated to shock.

Melissa Conley Tyler also wrote on the Commission of Audit, questioning whether more can be cut from the Department of Foreign Affairs and Trade's budget:

Given its razor gang mandate, it's no shock that the Commission didn't recommend increased funding for DFAT. But it's worth challenging the Commission's dismissal of the case for more funding on the basis that 'it is not surprising that an organisation delivering essentially the same function as it did 20 years ago should have essentially the same funding in real terms.'

If one looks at DFAT's workload this year — a term on UN Security Council, helping to host the G20 Summit, negotiating bilateral and regional trade deals and responding to ever rising consular demands — it's clear that we're not in 1994 anymore. By any international comparison, the case for greater funding is overwhelming. It can only be hoped that the government finds another way to honour its election commitment to 'implement a review of diplomatic resources…to ensure Australia's global diplomatic network is consistent with our interests.'

 Following reports last week that China has become, at least in purchasing power parity terms, the largest economy in the world, Julian Snelder looked at what China needs to do to turn this 'quantitative' growth into 'qualitative' growth. Julian's introduction contained some remarkable factoids:

Steel, a symbolic measure of industrial power, provides a stunning illustration. China's steel industry is almost ten times larger than America's and as big as the rest of the world's steel industry combined. Why China makes and uses so much steel is obvious: fixed asset investment, on buildings and infrastructure. China will construct fifteen times the residential floorspace built by Americans this year, and if you include unofficial construction, maybe much more.

That China's GDP should match the US is also unremarkable considering its population; it simply means Chinese on average are now one-fifth as productive as Americans. But having reached the first quintile of American 'frontier' productivity, how does China make the next 80%? Simply doing more of the same looks unsustainable. Looking again at construction, consider this fact: China uses more cement than any other nation. Per capita. Ever.

By some estimates, China has poured more concrete for its roads, railroads, dams, bridges, factories and skyscrapers in the three years between 2009 and 2011 than America did during the entire 20th century. 

Still on economics, Stephen Grenville followed on from his popular review of Thomas Piketty's Capital in the Twenty-first Century from a few weeks ago with a look at the other side of the income inequality debate — whether unequal income distribution is necessary for growth:

It is obvious to Piketty (and most of his readers) that the wealth disparities seen in advanced economies are not the essential drivers of growth. Patrimonial wealth is not more dynamic than earned wealth. And after all, the three decades after World War II were not only a time of greater equality; they were also a time of strong growth.

For emerging economies, however, the relationship between growth and income distribution has been much less clear-cut. 

The newly independent post-colonial governments often prioritised economic equality through state ownership, cooperatives and strong social programs. Whatever these approaches did for equality, they failed miserably in growth. Cuba illustrates the point. The response was a shift to more market-oriented arrangements, summarised in the Washington Consensus. The Consensus was often taken over by free-market ideologues with a conscious disregard for income-distribution. Their influence was, however, at the margin. The sensible middle ground has long accepted the importance of pro-poor policies and social programs to soften the sharp edges of the free market, even if this meant some cost in terms of slower growth.

Finally, our debate on 'Snowden WikiLeaks and the future of espionage' continued this week, with Paul Buchanan offering this primer on the oversight of intelligence agencies in democratic countries:

The fundamental difference between authoritarian intelligence operations and those conducted by democracies is that the former serve the regime while the latter serve society. Intelligence agencies in democracies answer to the government of the day but are not subjects of it. Instead, they can be considered to be commonweal organisations, much like fire services: while they are responsible to government in the first instance they serve society as a whole. 

Under authoritarian regimes, intelligence agencies overlap internal and external espionage functions and answer only to centralised executive authority. In democracies, intelligence agencies separate internal and external espionage functions and are held accountable by systems of checks and balances between the three branches of government, even if their leadership is directly overseen by, or is a part of, the executive branch.

The reason democratic intelligence oversight is ideally split among the three branches of government is to avoid concentration of power in intelligence collection and to promote transparency and accountability among those who hold the critical responsibilities of safeguarding the nation's secrets, thwarting the espionage of others, and collecting sensitive information vital to the national interest.

 Photo by Flickr user Jonas Lowgren.